Waltham Forest is set to prioritise digital self-service ‘wherever appropriate’, and use ‘data and insight’ to identify residents most in need of help as part of a cost-cutting bid, reports Josh Mellor, Local Democracy Reporter

Waltham Forest Council is considering a “transformational approach” to how it serves residents as it faces a funding gap of “£20-30million” over the next three years.

This year alone the council faces a funding gap of £16m, on a total predicted spend of £237m. The gap is a dramatic increase since February when the council’s financial strategy suggested it did not face a shortfall at all.

Much of the gap comes from a high demand for social care services it is legally required to provide such as supporting elderly residents, caring for looked after children and special educational needs.

Redundancies, cutting the use of agency or consultancy staff, and “deletion” of jobs are all being considered to cut costs in the short term.

However, the council says it will need to “go further and deeper” in the long term by developing a “transformational approach” to how it serves residents.

Although details of what this will look like are limited, the council says it wants to continue to focus on “improving resident experience” while using its resources in a “more efficient way”.

This includes “digital self-serve wherever appropriate”, preventing residents’ needs from increasing where possible, using “data and insight” to identify those most in need and a “targeted approach” to cutting costs in services such as social care.

Key challenges the council says it wants to continue to address for residents include “structural inequalities”, the cost of living crisis, the lack of secure and affordable housing, and the “prevalence” of insecure and low-paying work.

A more detailed budget plan is expected to be published in December.

Local authorities such as Waltham Forest are legally required to set a balanced budget before the start of each financial year.

In February the council assumed a gap of “nil” this year, a further £11m budget gap in 2024/25 and a £1.5m gap in 2025/26.

However, the council now says it is reviewing these figures following increased demand for services this year as well as high inflation and interest rate rises.

To deal with increased costs and avoid cuts to services, the council has used funds set aside for specific needs, known as earmarked reserves, which fell by 11% to £69.4m by March 2023. It has also put in place “savings” and cuts of £6.4m.

Failure to balance the budget because the cost of day-to-day services is higher than the council’s spending power would result in the council declaring itself effectively bankrupt through a “section 114” notice.

This has become increasingly common in recent years, with councils such as Thurrock, Croydon and Slough forced to cover costs by increasing council tax by higher than usual rates and selling off their assets.

Havering Council in East London recently warned that it may be six to twelve months away from issuing a section 114 notice.

In its budget report, Waltham Forest said delays to government reforms of the way money is shared out to councils means predicting funding beyond 2024/25 is “uncertain”.

Paul Douglas, cabinet member for public services, said: “We constantly review our budgets with monthly monitoring reports to the cabinet.

“This allows us to keep a close eye on the situation and respond swiftly if needed.

“No savings proposals have yet been agreed. The provisional Government funding settlement for councils is due before Christmas and the final one in late January.

“A plan for savings will be presented as part of the budget report in February 2024.”

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